Kausfiles

Borjas for Council of Economic Advisers

Here’s why Harvard economist George Borjas would be an inspired choice to run the Council of Economic Advisers in Trump’s White House. Put aside questions of formal qualifications, of which he has plenty— Prof. Borjas may be the nation’s most prominent economist when it comes Trump’s big issue, immigration. He’s certainly the most prominent economist sympathetic to Trump’s side. Specifically, Borjas refutes the comforting “narrative” that more immigration is “good for everyone,” arguing that it helps some groups (immigrants, employers) but hurts others — especially low-skilled Americans (and immigrants already here), against whom the newcomers compete. That’s the same group most obviously hurt by global trade. And it’s the heart of Trump’s winning constituency.

What happens if Trump names Borjas? He’ll be highly controversial. Which is great. There’ll be hearings — attention-getting hearings at which Borjas will be attacked as borderline deplorable by the small industry of well-funded economists and think-tankers who argue, counterintuitively, that immigration is an area where the laws of supply and demand don’t apply. (Flooding the market with new workers doesn’t lower wages! Not a #Slatepitch.) These critics may well have some good points to make (though in his latest book, We Wanted Workers, Borjas leaves one of the more prominent critics, Giovanni Peri, for dead like Darth Vader laid out on the lava banks of Mustafar). But if there’s a real argument, so much the better for the cause of making the Dem-leaning press aware that immigration control isn’t a matter of racism, or fear of “the other,” but largely a question of hard, dollars-and-cents economics for those (lower skilled workers) already hurt by modern economic trends (automation as well as trade). Let’s have it out! It’ll be like Kellyanne Conway vs. Mitt Romney, or Kellyanne Conway vs. Jennifer Palmieri! The noisier the better. Borjas will more than hold his own.

In the process, he might also address some other confounding issues (confounding to me, anyway): how, exactly, would mass immigration cure Lawrence Summers’ “secular stagnation”, as advertised, in a way that benefited the average worker? Is there really a skills “bottleneck” holding back production, or is that a fiction devised by employers who want to bring in cheaper foreigners? Will more immigrants help save Social Security? Is there any hope of luring more Americans into the labor force? The last chapter of Borjas’ book suggests he’ll address these, and other, issues with a mixture of professional creativity and humanity. (Example: Borjas estimates every 10 percent increase in the supply of unskilled labor lowers wages 3 to 10 percent. But he still favors a “mixed-skill” policy that lets in some unskilled immigrants for non-economic, humanitarian reasons–though maybe not from the Middle East.) He’s pro-assimilation, while worried about evidence of our eroding ability to assimilate the immigrants we’re getting.

Above all, he’s learned the hard way about the conformist power of PC narratives and conventions (e.g. “today’s immigrants are just like yesterday’s!”) — and the need to upend them when they don’t match reality. On Trump’s best days, that seems to be his calling as well.

Borjas has done fantastic, praiseworthy work. It would be a great nomination — showing that Trump wanted an administration that tries to measure costs and benefits, rather than just opposing immigration for show.

Glenn Loury would be another good pick. He hasn’t worked on immigration directly but has done a lot on economics of race, in particular of American blacks, in which unskilled immigration is a large negative influence. It would be a politically brilliant choice too.

Is California doing all that great? It has and has had a big illegal population. I understand we need illegals to pick the crops because we do not have a guest worker program. Oh, wait, we DO have a guest worker program. Hmm. . .

Of course, all that agriculture must really bring a lot to the state’s bottom line. Oh, wait. It’s 2% of the CA economy.

Well, we must want them for the other jobs no American will do. Like, Food Service Worker. I used to be a FSW when I was a teenager. So there must not be enough of those workers. Wait, the youth unemployment rate in CA for 16 – 19 year olds is 34.9%.

Now, what does it cost to educate the average Hispanic family in CA? Depends on how you count (????!!!!), but let’s say $10,000 per kid per year. That’s 2.6 kids/household* 13 years * $10000/kid/year = $338,000/household. With the median Hispanic household income of $47,000, the CA base income tax is $1,902/year/houshold. With an average household size of around 4 people, the unmarried folks get taxed $1,902 – (128 + 4 * 337) = $426 per year. The married folks get taxed $1,902 – (218 * 4 * 337) = $336 per year. That investment is going to be paid of real soon. Oh, and the percentage of Hispanics in CA primary schools is now more than 50%. No net drain there.

Meanwhile, CA now has the distinction of being the state in the nation with the highest per capita welfare rate.

CA is lucky to have a few industries, like Software, that the state government can suck off of to make sure the farmers have workers. 4% of the tech work-force is Hispanic.

Meanwhile, I’m sure some will consider these facts to be racist, or intolerant, or something. Too bad. They are what they are.

I agree Kim it has been very strange weather here. I showed pics of my front yard yesterday with all the Azaleas blooming! Mid-March! Oh well I hope this doesn't mean summer will be awful. We need our yard mowed now also. Your verbena is gorgeous! Lucky you with that redbud tree to look at! hugs, Linda